Guidelines for Impact Monitoring & Assessment in Microfinance ...

IMPACT MONITORING & ASSESSMENT IN MICROFINANCE PROGRAMMES
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→ ”Nothing has changed, because my husband used the loan.”
→ ”I increased the size of my livestock.”
→ ”I have my own savings now.”
If we only use the development objectives that were defined during project planning
as impact indicators, we might not capture the actual state of well-being of the target
population. We must consider that technical cooperation projects operate in dynamic
settings, and that the target population is a heterogeneous group of individuals. It is
therefore not surprising that different clients of MFIs anticipate different changes and
have different perceptions of how project interventions have influenced their lives.
The lives of the target population in microfinance programmes reflect complex and
dynamic realities that are influenced by individual perceptions, personal interactions
and often-restrictive environmental conditions.
Changes and Innovations are Results of Complex
Social Interaction Processes
A basic problem in microfinance is that poverty has been considered primarily as a
lack of income. This has reduced poverty to mere economic deficiency and neglects
understanding how poor people survive. If we understand the development process
as an interactive and complex social transformation process with multiple players
involved, impact is linked to individual, social and organizational relationships and
learning processes. Causes and rationales of changes in a person’s and family’s
life, or even in a community, do not necessarily include tangible and determinable
patterns. Taking into account the complex character of human, social, economic,
and political transformation processes, changes can often not be attributed to a single
factor. As life itself is a dynamic process, impact also changes its character over
time – in terms of its values, degrees, patterns, and directions.
It is not feasible to provide a universal definition of what impact really means. Instead,
we will review the discussion in a general manner and determine analytical
categories.